How much of wage differential is due to discrimination

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Q. Suppose years of schooling, S. is only variable that affects earnings. Following equations are weekly salaries of men and females
wm=500 + 100S
WF= 300 + 75S

On average men have 14 yrs of schooling and women have 12

What is male/female wage differential in labour market?

Using Oaxaca decomposition, calculate how much of wage differential is due to discrimination. What is an alternative Oaxaca decomposition that would lead to a different measure of discrimination? What measure is better?

Reference no: EM1372329

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